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Wednesday, October 5, 2022

Attorney General’s Office Reaches $13 Million Agreement With LG In Price-fixing Scheme

Washington Attorney General Bob Ferguson
Washington Attorney General Bob Ferguson

On Tuesday, Washington State Attorney General Bob Ferguson announced that consumer electronics company LG will pay $13 million in restitution over its alleged role in an elaborate price-fixing scheme amongst LCD manufacturers that cost consumers millions.

LG Display Co. Ltd. and LG Display America Inc. agreed to resolve allegations the companies violated Washington antitrust laws.

LG Display is one of eight liquid crystal display (LCD) manufacturers and their subsidiaries accused of fixing prices of LCD panels in the world market from 1998 to 2006.

LCD panels are used in products such as televisions, computer monitors and cell phones, and can account for as much as 80 percent of the cost of a finished device.

According to the Attorney General’s Office (AGO), price fixing is an agreement among competitors to raise, lower, or otherwise set the prices and any other competitive terms for their products or services. Price fixing hurts consumers, in this case by driving up the prices of items that use LCDs, such as TVs and cell phones.

“Illegal price fixing hurts consumers and the majority of businesses that play by the rules,” Attorney General Bob Ferguson said. “Our Antitrust Division works hard to protect Washington residents and hold accountable those businesses that seek to exploit unfair advantage.”

According to the complaint filed in 2010 by the State of Washington, the eight LCD manufacturers participated in cartel meetings in which they allegedly exchanged price information and agreed to fix panel prices and manipulate the supply of LCD panels to artificially increase panel prices.

The complaint alleged that LG Display was an active participant at the cartel meetings, where it made explicit agreements to set the price of LCD panels used in computer monitors and laptop computers.

The complaint also alleged LG Display also held one-on-one meetings with other manufacturers where it sought out and exchanged competitively sensitive information in order to manipulate the LCD panel market. To avoid detection, LG Display took steps to conceal its participation in these meetings.

LG Display did not admit the allegations in the complaint, but it agreed to the settlement terms. In addition to the $13 million payment, the agreement requires LG Display to participate in future monitoring and to develop programs to ensure there are no future antitrust violations.

In 2010, the Attorney General’s Office filed a lawsuit on behalf of Washington consumers and state agencies against 20 corporations involved in the alleged price-fixing scheme. Seven LCD manufacturers have pleaded guilty to related federal antitrust violations filed by the U.S. Department of Justice.

In 2012, Washington state reached an agreement with defendants Hitachi Ltd., Hitachi Display Co. Ltd. and Hitachi Electronic Devices (USA) Inc. for $5.2 million. A trial is scheduled for April 2015 for the remaining defendants. Once a resolution is reached with all of the involved companies, the Attorney General’s Office will begin the process of returning money to consumers.

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